As a reminder, Cavotec’s Q4 report was postponed from 25 Feb to 30 March in order to reclassify the soon-to-be-sold Airports business as an entity held for sale. New Cavotec’s order backlog grew 71% y-o-y and +7% q-o-q to EUR 99m (-3% vs. ABGSCe 102m for NC), due to growth in shore power and general industry. New Cavotec sales grew 5% y-o-y (on non-restated numbers) to EUR 31m (+4% vs. ABGSCe 30m for NC). EBIT for NC came in at EUR -1.7m (ABGSCe +0.8m for NC), due to personnel ramp-up and supply constraints. Excluding growth investments and non-recurring items, EBIT would have been break-even. A non-cash impairment charge related to Airports of EUR 33m was also booked in discontinued ops. Lease adj. FCF amounted to EUR 4m (3m for NC).
CEO departure, COVID lockdown, bank discussions initiated
As was previously announced in Feb, CEO Mikael Norin will leave later in the year. In addition, Cavotec claims that the recent lockdown in Shanghai due to COVID-19 has resulted in Cavotec not being able to deliver a ‘substantial part of booked orders’ (EUR 4m) end of Q1. These have not been cancelled but delayed until further notice. In addition, Cavotec has initiated a discussion with its banks in the event that they are not able to meet all the existing bank conditions in Q1. We believe that the impending sale of Airports for EUR 10-13m will help these negotiations (Q4’21 cash balance EUR 12m, lease adj. ND EUR 6m).
Final thoughts
We believe that the ongoing supply chain challenges, general cost inflation and resurgence in COVID cases will continue to negatively impact operations, especially during H1’21e before we currently forecast a notable improvement in NC profitability from Q3’22e. Although we find support in the continued strong backlog as well as already implemented improvements, we believe that visibility for 2022 remains ...
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